There are many benefits to joint commercial property ventures, but these are not without risk. We provide expert, independent advice to ensure the agreement is legally sound and your interests are protected.
A joint venture is an arrangement between two or more parties, where they agree to combine their resources to invest in commercial property. This means that all parties involved have a right to the profits and are liable for any costs involved.
A joint venture agreement provides the opportunity for a commercial property development that may have otherwise been unachievable. One party may own land but not the necessary skills or resources to see it developed, and another may have these missing elements. By entering into a joint venture agreement and working together, the land can be developed profitably so all party’s benefit.
The important considerations when entering into a joint venture agreement include:
- Financial contributions from each party
- Third-party financing
- Ongoing capital requirements
- Defaulting partners
- Framework for disputes/issues
- Framework for decision making
- Exit strategies
It is also important to consider tax efficiency. Our highly experienced team can ensure that all tax implications are thought through and kept to a minimum.
If the joint venture will involve a high cost project and both parties will are to contribute capital into the venture, they may decide to form a new company for this purpose (sometimes called a ‘special purpose vehicle or SPV’).
Before entering into a joint venture agreement, it is strongly advised to seek independent legal advice. We provide a personal and comprehensive service so that you are confident that your best interests are protected.
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